EU-US ‘green’ trade plan comes under fire at Bali

A joint EU and US proposal to remove all tariffs on a select list of 43 goods deemed to be environmentally friendly, such as solar panels and wind turbines, were criticised at Bali over the weekend by developing countries who say the plans are incomplete and biased towards developed countries. 

On Sunday (9 December), trade ministers met in the sidelines of the Bali UN Climate Change Conference to discuss a range of climate change-related trade issues.

• North-South divide?

Celso Luiz Nunez Amorim, Brazil’s minister of foreign relations, questioned the EU-US proposal, saying the list of 43 goods is ‘incomplete’ and that the plan is not an effective measure against climate change.

Brazil is concerned that the list of goods does not include biofuels, in particular ethanol made from sugar cane, a key export for Brazil.

Amorim also said the plan was a distraction and questioned whether it is in line with free trade principles. “What are we [in Bali] for? Are we here to make three things mutually supportive – development, trade and climate change – or are we here to discuss protectionist ways to slow down the process?”, he said.

Pakistan also questioned the proposals, saying their real intention was to give an advantage to technology exporters in rich countries. “This is obviously against us, because we have not the capacity to produce goods in an environmentally friendly way,” said Ali Baz, Pakistan’s Ambassador to Indonesia. 

• The trade-climate change link

But Pascal Lamy, head of the World Trade Organisation (WTO), said that some developing countries were leaders in green technologies and could benefit from the plans, adding that a special tariff reduction scheme could be made more equitable by being included in a wider global climate change regime. 

“The relationship between international trade and indeed the WTO and climate change would be best defined by a consensual, international agreement on climate change that successfully embraces all major polluters,” he said.

It is unclear if special tariffs on green goods could be agreed as part of a wider deal involving rich country technology transfers to poor countries as an alternative to a legally-binding international agreement to reduce CO2 emissions (see EURACTIV 06/12/07).

Read more with Euractiv

EU, US eye WTO free trade pact for climate-friendly goods

As world leaders meet in Bali to outline a new global climate regime, the EU and the US have launched a joint push for an international deal on eliminating tariffs on green technologies in the hope of opening up new market opportunities for business.